Panama law firm heavily implicated in ‘Pandora Papers’ revelations

A prestigious Panamanian law firm was named in the so-called “Pandora Papers” as implicated in the creation of
offshore shell companies meant to hide money in tax havens for more than 160
politicians and public figures.

They included “some accused of looting their countries,” according to the
International Consortium of Investigative Journalists (ICIJ), which obtained
the leaked documents as part of the Pandora Papers, published Sunday, which
sent shockwaves of embarrassment through powerful circles.

Aleman, Cordero, Galindo & Lee, or Alcogal, was involved in creating shell
companies to move money for Jordanian King Abdullah II, Czech Prime Minister
Andrej Babis, Montenegro President Milo Djukanovic and three former
presidents from Panama, among others, according to the bombshell release.

Others involved with Alcogal — co-founded in the 1980s by the son of a
former Panamanian ambassador to the United States who then became ambassador
himself — include a Honduran presidential candidate and a former president
of Ecuador.

The firm also worked with figures in some of the most notorious financial
scandals of the last decade, including the massive Latin American bribery
plot involving Brazilian construction company Odebrecht and the soccer
corruption case known as “Fifagate,” according to the ICIJ.

In a report, the ICIJ enumerated the 14,000 offshore entities in Belize,
the British Virgin Islands and Panama created with the help of Alcogal in an
effort to stash money away from public scrutiny for some 15,000 clients since
1996.

So prolific was the law firm’s offshore involvement that nearly two million
of the 11.9 million leaked documents associated with the Pandora Papers —
which were reported on by some 600 journalists — came from Alcogal. –
‘Magnet for rich and powerful’ –

According to the ICIJ, Alcogol played “a leading role in the tax avoidance
and asset protection industry.”

“Over the past three decades, Alcogal has become a magnet for the rich and
powerful from Latin America and beyond seeking to hide wealth offshore,” the
reporting group said, citing leaked corporate records.

“Firms like Alcogal propel that (shadowy) economy, helping well-heeled
clients find havens to conceal their money, sometimes from tax collectors and
criminal investigators. Ordinary people often pay the price,” the ICIJ report
on the firm said.

For example, the ICIJ says Alcogal set up more than 200 shell companies for
the Banca Privada d’Andorra, some of which were then used to conceal public
corruption in Venezuela. The United States later blacklisted the bank over
money laundering concerns and Alcogal disentangled itself from the bank.

The firm rejected accusations of shady dealings in a statement, saying it
was considering legal action to defend its reputation “in a vigorous manner
where necessary.”

“Alcogal rejects the conjecture, inaccuracies and falsehoods in the
papers,” the firm said, offering to work with authorities to investigate any
irregularities.

And several politicians named in the papers also pushed back, including
former Panamanian president Ricardo Martinelli, who denied involvement in
anything untoward.

The revelations from the Pandora Papers could further damage Panama’s
reputation, after the Central American country’s image already took a hit in
a previous round of financial scandal reporting known as the “Panama Papers”
five years ago.

The government worried about fallout from the new release, according to a
letter from officials released by local media.

“The damage could be insurmountable,” the Panamanian government said in the
letter, sent through a law firm to the ICIJ.

The letter warned that “any publication” reinforcing “a false perception”
of the country as a possible tax haven “will have devastating consequences
for Panama and its people.”

The letter from the Panamanian government also references some of the
reforms that the Central American country has made in recent years, although
it remains on the EU list of tax havens.

The Panama of 2016 “is nothing like the Panama of today,” the government
said in its letter.

AFP